CEO: Steel dumping hits home

June 12, 2013

WHEATLAND, Pa. - The top official for the company that owns local steel manufacturers Sharon Tube and Wheatland Tube compared fighting foreign steel dumping to a game of "Whac-A-Mole."

As soon as one foreign product is assessed duties, often the same overseas products will pop up again, often just under a different name, JMC Steel Group Chief Executive Officer and Chairman Barry Zekelman said Tuesday.

The head of the Chicago-based steel group was in town for the dedication of the newly expanded, reopened and rebranded Sharon Tube plant in Wheatland, Pa.

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CEO of JMC Steel Group Barry Zekelman talks about problems caused by dumping of foreign-made steel.

"The International Trade Commission imposes anti-dumping duties, but what happens is the Chinese lie and cheat in the face of them," a passionate Zekelman said.

To illustrate, he pointed to a reporter's notebook and explained that if duties were imposed on it, foreign interests might rename the product an "artist's drawing book." When the shipment hits U.S. shores, border patrols often lack the time or knowledge to distinguish the proper names of products, sending them easily into the domestic market.

"You are trying to create thousands of jobs - actually millions of jobs in America. We don't ask for one dime of government grants. We have $50,000 or $60,000 jobs, and by the way, you don't have to pay for Obamacare because we pay for their health benefits. All we ask is to enforce the trade laws," Zekelman spouted.

"That's the frustrating part. The jobs are here. They are waiting. We are being abused."

Referring to the growing domestic natural gas and oil industry, Zekelman also expressed frustration with foreign imports of tubular products like the one his company manufactures.

"We have energy independence at our fingertips. The whole North American public will benefit from this, except who? The North American steel industry."

Saying the market already is small for tubular products needed in the energy sector, Zekelman pointed out that about half of the products needed are being imported.

"Our energy independence is going to benefit them," he said.

Mercer County commissioner Brian Beader, who also attended Tuesday's dedication, expressed similar concerns, but said repeated trips to Washington to argue for stricter restrictions have helped.

"We know we were taking a hard hit by tube dumping. We testified in front of the ITC of the damage that they were doing to our local tube mills," Beader said.

He said the testimony helped lead to the imposition of new duties on steel products, helping to trigger new domestic growth. Still, he said, there is more work to be done.

In an unrelated case of foreign steel dumping, the ITC is continuing its investigation into allegations brought by Warren's Thomas Steel Strip of Japanese dumping.

A preliminary federal report released this week indicates data provided by Thomas Steel Strip shows "there is reason to believe that imports of certain nickel-plated, flat-rolled steel from Japan are being, or are likely to be sold in the United States at less than fair value."

Thomas, on Warren's west side, is the only remaining domestic producer of a specialized nickel-plated steel used for alkaline batteries and automobile fuel lines. In March the company complained that it has lost significant business to Japan, including a "crippling lost sale" late last year that cost the company business in making steel used to manufacture AA alkaline batteries.